Correlation Between Haima Automobile and Huizhou Speed
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By analyzing existing cross correlation between Haima Automobile Group and Huizhou Speed Wireless, you can compare the effects of market volatilities on Haima Automobile and Huizhou Speed and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Haima Automobile with a short position of Huizhou Speed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haima Automobile and Huizhou Speed.
Diversification Opportunities for Haima Automobile and Huizhou Speed
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Haima and Huizhou is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Haima Automobile Group and Huizhou Speed Wireless in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huizhou Speed Wireless and Haima Automobile is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Haima Automobile Group are associated (or correlated) with Huizhou Speed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huizhou Speed Wireless has no effect on the direction of Haima Automobile i.e., Haima Automobile and Huizhou Speed go up and down completely randomly.
Pair Corralation between Haima Automobile and Huizhou Speed
Assuming the 90 days trading horizon Haima Automobile Group is expected to under-perform the Huizhou Speed. But the stock apears to be less risky and, when comparing its historical volatility, Haima Automobile Group is 1.34 times less risky than Huizhou Speed. The stock trades about -0.18 of its potential returns per unit of risk. The Huizhou Speed Wireless is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 1,387 in Huizhou Speed Wireless on October 28, 2024 and sell it today you would lose (70.00) from holding Huizhou Speed Wireless or give up 5.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haima Automobile Group vs. Huizhou Speed Wireless
Performance |
| Timeline |
| Haima Automobile |
| Huizhou Speed Wireless |
Haima Automobile and Huizhou Speed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haima Automobile and Huizhou Speed
The main advantage of trading using opposite Haima Automobile and Huizhou Speed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haima Automobile position performs unexpectedly, Huizhou Speed can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Huizhou Speed will offset losses from the drop in Huizhou Speed's long position.| Haima Automobile vs. China Longyuan Power | Haima Automobile vs. PetroChina Co Ltd | Haima Automobile vs. Guangxi Guiguan Electric | Haima Automobile vs. Yantai North Andre |
| Huizhou Speed vs. Bus Online Co | Huizhou Speed vs. Holitech Technology Co | Huizhou Speed vs. Gome Telecom Equipment | Huizhou Speed vs. Cultural Investment Holdings |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.
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